For just over a year, the U.S. government has offered a tax credit to first time homebuyers. Just within the month of August more tax credit news has developed and we suspect we’ll see eve more. Here’s a quick recap of some of the current initiatives in place created to spur activity in the housing market, help save companies from eliminating more jobs and improve the environment.
First-time homebuyer tax credit – the shovel that’s trying to dig us out of a big hole
Clearly the first-time homebuyer tax credit has been a big success. Home sales have been rising over the past few months as a result. But when it expires in November, we’re really going to feel the impact.
Congress currently has two bills pending with the intent to extend the first-time homebuyer tax credit, awaiting decisions from both the House and Senate. Not only could the deadline be extended, but the credit amount would almost be doubled.
Instead of offering $8,000, Georgia Republican Senator Johnny Isakson co-sponsored the bill that looks to raise the credit amount to a maximum of $15,000. Apparently he’s not the only one interested, 70 million homeowners want it as well. In addition to raising the credit limit, the bill would also:
- Expand eligibility to any buyer
- Eliminate the income cap
- Extend the tax credit for one year from the date of enactment
Credit on windows and doors – seal it up and save
There is now a tax credit offered to homeowners who replace their older windows and doors with new energy efficient ones before the end of 2010. As part of the American Recovery and Reinvestment Act of 2009, the U.S. government is offering back 30% of the product cost until you reach a cap amount of $1,500, not including installation. As expected, the window and door manufacturers have made this the focus of their current marketing efforts.
Appliance rebate program – coming soon to a home near you
This Fall a $300 million appliance-rebate program, another feature of the American Recovery and Reinvestment Act, will encourage the purchase of energy-efficient appliances, including dishwashers, refrigerators and washing machines. Consumers could receive up to $200 per appliance for buying Energy Star qualified models. Rebates amounts will be determined by your state. Much like the Energy Tax Credit advertisements, you can expect to see an aggressive push from the manufacturers to educate and entice consumers.
Retrofit for Energy and Environmental Performance – remodelers REEP the benefits
The Retrofit for Energy and Environmental Performance program, better known as REEP, is part of the American Clean Energy and Security Act of 2009 and was created to reduce energy consumption in existing residential and commercial buildings. Pending Senate approval, grant money would be provided to state energy offices and passed through to homeowners as retorfit incentives. Much like the Energy Tax Credit, this will significantly increase remodeling activity. Learn more about REEP from Remodeling Magazine.
So if you’re a consumer who found this blog, or happen to be someone in the market for a new home, here’s what you do to take advantage of these incentives and continue to stimulate the housing market. Buy an exisiting home, retrofit it with new windows and appliances, find other ways to reduce energy consumption and potentially save thousands of dollars while feeling good about minmizing your enivonrmental footprint.